Idra opens special audits into 15 life insurers

The Insurance Development and Regulatory Authority (Idra) has appointed audit firms to carry out special audits of 15 life insurance companies for the 2022-2024 period to uncover possible irregularities as claim settlements continued to mount.

"We have an internal grading system based on specific criteria, which was completed in February this year," said an official of the regulator, requesting anonymity.

"These 15 companies were flagged as the weakest performers in that assessment, which is why special audits are now being carried out," the official added.

Appointed last Sunday, the 15 different audit firms will have to submit comprehensive audit reports within 30 working days, said the official.

They will also verify whether the life insurers are operating in accordance with the Insurance Act 2010, added the official.

The companies include Sunlife Insurance, Homeland Life Insurance, Padma Islami Life Insurance, Progressive Life Insurance, Protective Islami Life Insurance, Best Life Insurance, and Prime Islami Life Insurance.

Also on the list are Jamuna Life Insurance, Diamond Life Insurance, Swadesh Life Insurance, Sunflower Life Insurance, Fareast Islami Life Insurance, Golden Life Insurance, Baira Life Insurance, and NRB Islamic Life Insurance.

The Daily Star yesterday tried to contact at least five companies for comments on the matter.

Officials of four of these companies did not respond to phone calls. An official of the remaining company said they have not yet received any letter from the regulator regarding this issue.

Data from the regulator showed that by the end of 2024, the companies had outstanding claims of Tk 4,615 crore from policyholders. However, they paid only Tk 635 crore to their customers.

Saifunnahar Sumi, media and communication consultant and Idra spokesperson, said the audits would focus on reasons behind claims remaining unsettled, dearth of life funds, excessive management expenses, and poor portfolio management.

Another aim is to identify malpractices and those responsible, she added.

Adeeba Rahman, first vice-president of the Bangladesh Insurance Association and sponsor director of Delta Life Insurance Company Limited, said this is a good initiative by the Idra to ensure discipline in the sector.

Without discipline, customer confidence will not grow, she said, adding that to build customer trust, companies must first ensure compliance with regulations.

The country has 82 insurance companies—36 life insurers and 46 non-life insurers.